Post Magazine

Amid China tech advances, US national security is 'foremost': top Biden official

A top American government official on Wednesday made clear that national security supersedes commercial interests as US President Joe Biden's administration tackles what it perceives to be the threat of China's advancing technological capabilities.

Speaking before the House Appropriations committee, Commerce Secretary Gina Raimondo also highlighted ongoing efforts to identify areas where the US was most vulnerable to Chinese overcapacity.

"I tell semiconductor companies that they can't sell their chips to China. It denies them revenue. But first and foremost it's national security," Raimondo told the panel.

Do you have questions about the biggest topics and trends from around the world? Get the answers with SCMP Knowledge, our new platform of curated content with explainers, FAQs, analyses and infographics brought to you by our award-winning team.

Her testimony followed an apparent decision by her department to prohibit American tech titans Qualcomm and Intel from supplying their less advanced chips used in laptops and handsets to Huawei Technologies, a Chinese telecoms company.

In a filing submitted to the US Securities and Exchange Commission on Wednesday, Intel said the Commerce Department had revoked "certain licenses for exports of consumer-related items to a customer in China" - without naming Huawei.

Consequently, Intel said it anticipated that its revenue for the second quarter of 2024 would stay within the initial projected range of US$12.5 billion to US$13.5 billion but below the midpoint.

The US Commerce Department has not publicly announced the decision, and it did not respond to a request for comment.

When asked on Wednesday to comment on the matter, Raimondo called Huawei a risk while refraining from offering direct remarks about either Qualcomm or Intel.

Still, she pledged to take further action. "While Huawei is a threat, AI is our focus," the commerce secretary said. "As we get more data around our threats, we make changes to tighten screws, including revoking licenses that had been previously given."

The decision arose after Huawei last month unveiled its first AI-enabled laptop, the MateBook X Pro, which runs on Intel's newest processor, the Core Ultra 9.

Washington contends Huawei has strong connections to China's Communist Party and could be used for spying on Americans and important US military and civilian systems.

On Wednesday, Raimondo said that she wakes up "every single day figuring out how we might tighten our controls to make sure that China cannot get access to our most sophisticated chips, AI, quantum" and other technology.

In recent years, the US government has placed several Chinese companies, including Huawei, on multiple blacklists.

Beyond export restrictions, Biden signed an executive order last August prohibiting Americans from investing in sensitive technologies in China.

And in the run-up to the American presidential election in November, Biden has amplified his messaging on the hazards of Chinese overcapacity.

The president has vowed to implement measures to shield American manufacturers from Chinese state subsidies and the product gluts resulting from them.

"Because Chinese steel companies produce a lot more steel than China needs, [Beijing] ends up dumping the extra steel into the global markets at unfairly low prices," Biden said last month at a campaign event. "They are cheating."

Raimondo told lawmakers on Wednesday she "worried greatly" about the possibility of China hurting American manufacturers by dumping cheap products like electric vehicles, legacy chips and critical minerals.

The Commerce Department was working closely with the Office of the United States Trade Representative to "identify where are we most vulnerable and what actions could we take", she added.

Raimondo alluded to a survey of China-made legacy chips in the US defence industrial base that her department announced months ago, saying commerce officials were trying to ascertain where such chips appear in American supply chains.

The search was on, she added, for "any evidence of China dropping the price, which would distort the market and make it impossible for US chip companies to compete".

This article originally appeared on the South China Morning Post (SCMP).

Copyright (c) 2024. South China Morning Post Publishers Ltd. All rights reserved.

More from Post Magazine

Post Magazine2 min read
Hong Kong's TVB Gets Nod To Sell Minority Stake To Finance Firm As It Seeks Funds For New Productions
Hong Kong's communications watchdog has given the city's biggest free-to-air broadcaster, TVB, approval to sell a minority stake to a financial firm as part of an exercise to raise HK$109.4 million (US$14 million) for new productions. The Communicati
Post Magazine5 min read
World Bank Finds Chinese Company Committed Violations In Bolivian Infrastructure Project
A World Bank investigation into a US$230 million infrastructure project in Bolivia found numerous violations committed by a large state-owned Chinese construction company, including disregard for local labour laws and environmental damage, complicati
Post Magazine3 min readInternational Relations
China Considering Car Tariffs To Retaliate Against US And EU Moves, Trade Group Says
China is considering raising tariffs on some car imports, according to a prominent business group, a move that would counter EU and US trade actions against Chinese-made electric vehicles. In a statement on Tuesday evening, the China Chamber of Comme

Related Books & Audiobooks